Express Scripts (ESRX): Today's Highlighted Laggard In Health Services

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

Express Scripts ( ESRX) pushed the Health Services industry lower today making it today's featured Health Services laggard. The industry as a whole closed the day down 0.3%. By the end of trading, Express Scripts fell 85 cents (-1.4%) to $58.34 on light volume. Throughout the day, four million shares of Express Scripts exchanged hands as compared to its average daily volume of 5.9 million shares. The stock ranged in price between $58.25-$59.35 after having opened the day at $58.79 as compared to the previous trading day's close of $59.19. Other companies within the Health Services industry that declined today were: MAKO Surgical Corporation ( MAKO), down 7.1%, American Caresource Holdings ( ANCI), down 5.2%, TranS1 ( TSON), down 4.9%, and Cryolife ( CRY), down 3.6%.
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Express Scripts Holding Company provides a range of pharmacy benefit management (PBM) services primarily in the United States and Canada. It offers healthcare management and administration services on behalf of its clients. Express Scripts has a market cap of $48.45 billion and is part of the health care sector. The company has a P/E ratio of 33.1, above the S&P 500 P/E ratio of 17.7. Shares are up 9.6% year to date as of the close of trading on Wednesday. Currently there are 14 analysts that rate Express Scripts a buy, no analysts rate it a sell, and four rate it a hold.

TheStreet Ratings rates Express Scripts as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, reasonable valuation levels, increase in net income, good cash flow from operations and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the health services industry could consider Health Care Select Sector SPDR ( XLV) while those bearish on the health services industry could consider ProShares Ultra Short Health Care ( RXD).

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